Individual Stocks

Selecting Individual Stocks

What is “behavioral economics”?

Behavioral economics, or behavioral finance, is a relatively new science that tries to help you understand why people make often irrational financial decisions, based upon their own perceptions and biases. For example, if the consumers of a product or stock investment perceive the supply is somehow diminishing, they may be more prone to purchase it now, rather than waiting for a better, more rational time during which to purchase.